TSX Venture Symbol: PEN
VANCOUVER, Feb. 21 /CNW/ - Pennant Energy Inc. (TSX Venture Exchange - PEN") is pleased to announce that it has signed a Letter of Intent with Silver Spirits Inc. (Silver Spirits), a private Alberta company, to undertake certain exploration activities and analysis of Silver Spirits lands (the "Lands") located in the Fort Saskatchewan Field area, east of the City of Edmonton in Township 54 Range 22W4. The Fort Saskatchewan Field produces mainly natural gas from various formations including the Mannville intervals, Ellerslie and Ostracod and shallower Viking reservoirs. Pennant will undertake to analyze all available data covering the Silver Spirits land and carry out additional geochemical surveys at its sole expense, with the objective of identifying drilling locations for natural gas and/or oil potential to the base of the Mannville formation depth. Silver Spirits holds 2 sections of land in this relatively undeveloped area of the field; one section offsets an abandoned Ellerslie formation gas well which produced in excess of 1 billion cubic feet of gas. Pennant, by undertaking the work commitment will earn the option to enter into a formal Farmout Agreement (the "Agreement") to drill a test well on the Lands. The terms of the Agreement will call for Pennant to pay for 100% of the costs to drill and case or abandon the test well, to earn a before payout (BPO) working interest (WI) of 100% in the drilling spacing unit subject to a 7.0% gross overriding royalty (GORR) on oil and/or gas and 65% WI in the balance of the acreage; at payout of the test well, Silver Spirits will have the option to convert the GORR to a 35% WI.
Southern Alberta Project Update: as noted in our press release of January 18, 2008, our joint venture partner and operator of the project, Drumlin Energy Corp. informed Pennant that the shooting of the 3D Seismic Survey was completed and processing was underway. The interpretation of the data is progressing and is expected to be finished soon. The objective of the seismic program is to identify high quality, natural gas drilling targets in Mannville channel reservoirs. The program, located in Southern Alberta, covered approximately 4.5 square miles. Through participating in the shooting and processing of the 3D seismic survey Pennant will earn an undivided 25% interest in 3 sections (1,920 acres) of land in the area. Pennant is not subject to further promotion and will have the option to participate on a pro rata basis in drilling and development activities thereafter. contact the company at 604-689-1799 or visit our web site at www.pennantenergy.com
ON BEHALF OF THE BOARD OF DIRECTORS OF
PENNANT ENERGY INC.
"Jim Britton"
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Mr. Jim Britton
P. Geol. - Director
This News Release may contain forward-looking statements based on assumptions and judgments of management regarding future events or results that may prove to be inaccurate as a result of exploration and other risk factors beyond its control, and actual results may differ materially from the expected results.
The TSX Venture Exchange has not reviewed and does not
accept responsibility for the adequacy or accuracy of this release.
Contactson any of our projects please feel free to contact the company at (604) 689-1799 or visit our web site at www.pennantenergy.com
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